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1994 (3) TMI 406
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....times a cess at the rate of 2 ½% ad valorem was leviable on all types of mica exported from India under the provisions of Mica Mines Labour Welfare Fund Act, 1946 (hereinafter referred to as the said Act of 1946). 4. During the period, October 14, 1966 to February 17, 1967, the plaintiff exported from the Port of Calcutta diverse consignments of mica to various foreign countries. In respect of the said assessments, the said authorities calculated the value of mica exported by the plaintiff upon taking into consideration, inter alia, the cess payable as aforesaid at the rate of 2 ½% of the value of the mica exported treating the said cess as part of the value of such mica. 5. The plaintiff made payments to the Government of India on the basis of the said assessments made by the authorities on account of export duty. 6. It is the case of the plaintiff that in assessing the export duty payable by the plaintiff in respect of the said consignments, the plaintiff had, in fact, paid an excess sum of Rs. 1,05,745.25 inasmuch as the customs authority wrongfully and illegally took into consideration the cess at the rate of 2 ½% of the value of the mica exported ....
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....in respect of the consignments of mica exported by the plaintiff as aforesaid. 11. According to the plaintiff, the said purported assessments made by the customs authorities to the extent of the said sum of Rs. 1,05,745.25 in respect of the aforesaid consignments were and are in excess of jurisdiction and beyond the scope and/or purview of the Customs Act, 1962 and/or illegal, void and of no effect. 12. It is claimed by the plaintiff that the said sum of Rs. 1,05,745.25 was paid as export duty and/or part of export duty in respect of the aforesaid consignments by the plaintiff under the aforesaid mistaken belief and misapprehension and as such the defendant is not entitled to retain and is bound to pay and/or refund the same to the plaintiff. 13. In the premises the plaintiff has asked for a decree for the sum of Rs. 1,05,745.25 which was allegedly realised in excess of jurisdiction and on the basis of mistake of law common to both the parties. 14. In the written statement there has been only a bare denial of the case made out by the plaintiff. A contention has been raised that the suit is not maintainable in view of Section 27 of the Customs Act, 1962. It is also the c....
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....ble from the price when determining the 'value' of the excisable article. The old Section 4 provided by the explanation thereto that in determining the price of any article under that section no abatement or deduction would be allowed expect in respect of trade discount and the amount of duty payable at the time of the removal of the article chargeable with duty from the factory or other premises aforesaid. The new Section 4 provides by Sub-section (2) that where the price of excisable goods for delivery at the' place of removal is not known and the value is determined with reference to the price for delivery at a place other than the place of removal, the cost of transportation from the place of removal to the place of delivery has to be excluded from such price. The new Section 4 also contains Sub-section (4)(d)(ii) which declares that the expression 'value' in relation to any excisable goods, does not include the amount of the duty of excise, sales tax and other taxes, if any, payable on such goods and, subject to such rules as may be made, the trade discount (such discount not being refundable on any account whatsoever) allowed in accordance with the normal ....
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....ity. It would not be a case of mere error of law or fact under the provisions of the Customs Act, 1962 to levy the export duty on "cess" not authorised under the Act and the same will be beyond the scope and purview of the Customs Act, 1962 and/or the jurisdiction, authorities and competence of the officers under the Act. 21. The next question is whether the suit is maintainable in view of the provisions contained in Section 27 of the Customs Act, 1962. Section 27, as it stood at the material time, so far as material for our purpose, is as follows:-- Section 27: Any person claiming refund of any duty paid by him in pursuance of an order of assessment made by an officer of customs lower in rank than an Assistant Collector of Customs may make an application for refund of such duty to the Assistant Collector of Customs before expiry of 6 months from the date of payment of duty: Provided that the limitation of six months shall not apply where any duty has been paid under protest. Explanation: Where any duty is paid provisionally under Section 18, the period of six months shall be computed from the date of adjustment of duty after the final assessment there....
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....ms has not acted in conformity with the fundamental principles of judicial procedure or the authority has acted in violation of the fundamental principles of judicial procedure or he has made an order which is not within his competence or the statute which imposes liability is unconstitutional, or where the order is alleged to be mala fide. A civil suit will lie for obtaining appropriate relief in these cases. (Emphasis added) 27. In this case, as I have already indicated, the "value" in relation to any excisable goods does not include the amount of the duty of cess which is by way of customs duty and cannot be the part of the assessable value. The customs authorities had no jurisdiction to determine the assessable value in treating the cess as part of the assessable value and, accordingly, the order imposing the duty on the plaintiff on such basis is not within the competence of the customs authorities or within the provisions ' of the statute. The liability imposed, in this case, is therefore, unconstitutional. 28. The present case, in my view, comes within the purview of the principles laid down by the Supreme Court in Patel India (Private) Ltd. v. Union of India an....
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.... applied for refund of the excess duty charged in respect of some of items, viz., items 22 to 29 and 33-35. This was done under Section 40 of the Act and within the period appointed therein. The customs granted refund on the aforesaid items 22 to 29 and 33-35, although invoice value thereof had not been accepted and excess duty had been charged. The customs authorities, however, declined to refund the excess duty in respect of rest of the items. The reason given for such refusal was that the application for refund in respect of those items had not been made within the time prescribed by Section 40. An appeal to the Collector and a revision before the Government of India against the said refusal to grant refund were both rejected, the refusal by the Customs Appraiser being confirmed on the ground that refund was not applied for in time under Section 40. The appellant-company, thereupon, filed a writ petition in the High Court of Punjab (at Delhi) under Article 226 of the Constitution of India pleading, inter alia, that: (a) Section 40 of the Act had no application, (b) the Union of India was not entitled to appropriate or retain the said excess duty, (c....
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....s or charges which have been paid, and of which repayment wholly or in part, is claimed in consequence of the same having been paid through inadvertence error or misconstruction, shall be returned unless such claim is made within three months from the date of such payment. The section clearly applied only to cases where duties have been paid through inadvertence, error or misconstruction and where refund application has to be made within three months from the date of such payment. As rightly observed by the High Court, the present case was not one where the excess duty was paid through any of the three reasons set out in Section 40. The excess duty was demanded on the ground that the invoice price was not the real value of the imported goods and payment under protest was also made on that footing. The ultimate result in the appellant-company's revision was that charging of excess duty was not warranted under the Act, and that the value on which duty should have been assessed was the invoice price and nothing else. That being the position, Section 40 did not apply and could not have been relied upon by the Customs authorities for refusing to refund the excess duty unlaw....
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.... Court to consider that it is unreasonable to entertain that petition, though, even in cases where it is filed within three years, the Court has a discretion, having regard to the facts and circumstances of each case, not to entertain the application. 32. In that case, however, the Supreme Court did not grant relief in the writ petition as there was inordinate delay in filing the writ petition. The appellants who are directed by the Court to file suits being they are so advised. In this instant case, as I have already indicated the plaintiff made the payment of duty under a mistake of law and the plaintiff filed the suit as soon as the mistake was discovered. Therefore, the plaintiff is entitled to succeed in this case. 33. In Shiv Shankar Dal Mills v. State of Haryana and Ors. reported in [1980]1SCR1170 , V.R. Krishna Iyer, J. speaking for the Supreme Court observed as follows:-- Where public bodies, under colour of public laws, recover people's money, later discovered to be erroneous levies, the dharma of the situation admits of no equivocation. There is no law of limitation, especially for public bodies, on the virtue of returning what was wrongly recovered to....
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.... The Bombay High Court in Industrial Cables (India) Ltd. v. Union of India and Ors., reported in 1985(19)ELT351(Bom) (printed at page 112 infra) held that where the duty was collected without authority of law it is trite to say that it is the obligation of the Department to refund the excess of duty collected without authority of law. There the Bombay High Court followed the decisions of the Supreme Court in Patel India (Private) Ltd. (supra) and M/s. Shiv Shankar Dal Mills (supra). 38. The concept of actions without jurisdiction was expounded and extended in the case of Anisminic Ltd. v. Foreign Compensation Commission (1969) 2 AC 147. The said decision was subsequently approved by the House of Lords in Racal Communications Ltd. reported in 1981 AC 374. In that case Lord Diplock has observed as follows: ...where Parliament confers on an administrative tribunal or authority, as distinct from a Court of law, power to decide particular questions defined by the Act conferring the power, Parliament intends to confine that power to answering the question as it has been so defined: and if there has been any doubt as to what that question is, this is a matter for courts of law....
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....fect good faith have misconstrued the provisions giving it power to act so that it failed to deal with the question remitted to it and decided some question which was not remitted to it. It may have refused to take into account something which it was required to take into account. Or it may have based its decision on some matter which, under the provisions setting it up, it had no right to take into account. I do not intend this list to be exhaustive. But, if it decides a question remitted to it for decision without committing any of these errors it is as much entitled to decide that question wrongly as it is to decide it rightly. To the same effect are also the observations of Lord Peace at page 233. R.V. Fulham, Hammersmith and Kensington Rent Tribunal (1953) 2 All ER 4 is yet another decision of a Tribunal properly embarking on an enquiry, that is, within its jurisdiction, but at the end of it making an order in excess of it jurisdiction which was held to be a nullity though it was an order of the kind which it was entitled to make in a proper case. 40. In Universal Drinks Private Ltd., Nagpur v. Union of India and Anr., reported in 1984(18)ELT207(Bom) , the Division....
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....s was and/or is not a part of the assessable value, any duty realised on the basis of the said value will be clearly without authority of law and/or in excess of the jurisdiction conferred on the authority. It would not be a case of mere error of law or fact under the provisions of the Customs Act, 1962 to levy the export duty on "cess" not authorised under the Act and the same will be beyond the scope and purview of the Customs Act, 1962 and/or the jurisdiction, authority and competence of the officers under the Act. The Customs Act is complete code only if the Customs authorities act within the scope of the provisions of the Act but if customs authority acts beyond the scope of the Act then the order of the Customs authorities cannot be treated as final. Section 27 is not applicable in case where the duty is realised unconstitutionally or illegally or without any authority of law or in excess of power conferred under the statute, or Rules or notification even if the application for refund is time-barred under the Customs Act. If there is no machinery for refund of taxes collected in excess of constitutional limits or illegally collected, the suit lies. In the instant case, the co....